Which of the following is true when a significant amount of evidence is in electronic form?
A) Audit risk decreases.
B) It may not be possible to reduce detection risk to an acceptable level by performing only substantive tests.
C) Acceptable assurance usually increases.
D) It is usually impractical to evaluate controls.

Question

Quizplus · Accepted Answer

When a significant amount of evidence is in electronic form, it may not be possible to reduce detection risk to an acceptable level by performing only substantive tests because electronic evidence is often complex, voluminous, and challenging to analyze. Therefore, auditors may need to rely on tests of controls in addition to substantive tests to obtain sufficient evidence.

Which of the Following Is True When a Significant Amount